American Family Insurance Company v. Troyan

OCR transcription for search; preserved printed pages are authoritative

The court incorporates by reference in this paragraph and adopts as the findings and orders

of this court the document set forth below.

S/ RUSS KENDIG

Russ Kendig
United States Bankruptcy Judge

UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF OHIO

EASTERN DIVISION
IN RE: ) CHAPTER 7
)
JAMES PETER TROYAN, ) CASE NO. 10-63877
)
Debtor. ) ADV.NO. 10-6128
)
AMERICAN FAMILY ) JUDGE RUSS KENDIG
INSURANCE COMPANY, )
)
Plaintiff, )
Vv. ) MEMORANDUM OF OPINION (NOT
) INTENDED FOR PUBLICATION)
JAMES PETER TROYAN, )
)
Defendant. )

Plaintiff filed a motion for summary judgment pursuant to Federal Rule of Bankruptcy
Procedure 7056, the bankruptcy adoption of Federal Rule of Civil Procedure 56, on February 15,
2011. Plaintiff contends a debt owed it as a subrogee of its insureds, who were injured in an
accident caused by Debtor-defendant, is nondischargeable under 11 U.S.C. § 523(a)(9). Debtor

opposed the motion.

The court has jurisdiction of this proceeding pursuant to 28 U.S.C. §§ 1334 and the
general order of reference entered in this district on July 16, 1984. Venue in this district and
division is proper pursuant to 28 U.S.C. § 1409. This is a core proceeding under 28 U.S.C.

§ 157(b)(2)@.

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This opinion is not intended for publication or citation. The availability of this opinion,
in electronic or printed form, is not the result of a direct submission by the court.

FACTUAL BACKGROUND

Debtor’s negligent operation of a motor vehicle on February 26, 2008 caused injury to
Plaintiff’s insureds. Plaintiff paid claims on the insureds’ behalf and alleges it became the
subrogee of their claims against Debtor. In connection with the accident, Debtor was charged
with operating a motor vehicle under the influence of alcohol (“OVI”) pursuant to O.R.C.

§ 4511.19(A)(1)(f). He pled no contest, was found guilty and sentenced on March 11, 2008 in
the Canton Municipal Court.

LAW AND ANALYSIS

Motions for summary judgment are governed by Federal Rule of Bankruptcy Procedure
7056, which incorporates Federal Rule of Civil Procedure 56 into bankruptcy practice. The rule
sets forth the foundation for summary disposition:

The court shall grant summary judgment if the movant
shows that there is no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter of
law. The court should state on the record the reasons for
granting or denying the motion.

Plaintiff, as movant, bears the initial burden of proof, with the “responsibility of informing

the . . . court of the basis for [their] motion, and identifying those portions [of the record] . . .
which [they] believe[] demonstrate the absence of a genuine issue of material fact.” Celotex
Corp. v. Catrett, 477 U.S. 317, 323 (1986). In reviewing a motion for summary judgment, a
court must construe the evidence in the light most favorable to the nonmoving party. Adickes v.
S.H.Kress & Co., 398 U.S. 144, 158-59 (1970).

Plaintiff moves for summary judgment on its section 523(a)(9) nondischargeability claim.
This section prevents discharge of a debt “for death or personal injury caused by the debtor’s
operation of a motor vehicle . . . if such operation was unlawful because the debtor was
intoxicated from using alcohol, a drug, or other substance.” Plaintiff argues that, because the
Canton Municipal court found Debtor guilty and sentenced him on the OVI charge, there is no
question of fact that he was unlawfully operating a vehicle while intoxicated. Debtor opposes
summary judgment, arguing that Federal Rule of Evidence 410 bars use of the no contest plea to

establish nondischargeability.

The court agrees with Debtor. Federal Rule of Evidence 410 succinctly states that evidence
of a plea of nolo contendere is not admissible against the defendant in a subsequent civil or criminal

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proceeding. See also Johnson v. Johns (In re Johns), 158 B.R. 687, 690 (Bankr. N.D. Ohio 1993)
(‘in any subsequent action, including a bankruptcy case, neither the plea of nolo contendere nor the

conviction based on the plea may be admitted as either an admission, as a judgment of conviction,
or to impeach.”). Plaintiff simply cannot rely on the no contest plea as proof that debtor caused
personal injury while unlawfully operating a motor vehicle under the influence of alcohol.

Plaintiff has introduced no other evidence of debtor’s intoxication to satisfy its burden of
proof on the 11 U.S.C. § 523(a)(9) claim. Consequently, it is not entitled to summary judgment.

An order shall be issued immediately.

# # #

Service List:

Andrew C Stebbins
William H. Keis, Jr.
Keis George Ilp

55 Public Square
#800

Cleveland, OH 44113

James Peter Troyan
2527 7th St NE
Canton, OH 44704

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